Cloudflare & Media Companies Agree to Modify “Power Grab” Piracy Injunction

When United King Film Distribution, DBS Satellite Services, and Hot Communication won copyright lawsuits against three pirate streaming sites in April, the court gave them everything they asked for.

In addition to millions in damages against pirate streaming/IPTV platforms Israel-tv.com, Israel.tv and Sdarot.tv, the court handed down the broadest injunction ever seen in a US piracy case.

The injunction banned every online service provider from doing any business with the pirate platforms and ordered residential ISPs to block their current domains and any that appear in the future. In hindsight, it was a case of being careful what you wish for, because you may just get it.

With extraordinary power at hand, the media companies (all members of anti-piracy group Zira) began seizing domains but mysteriously asked the court not to enforce the requirement for residential ISPs to block the sites.

It appeared that someone may have started to push back and after issuing all kinds of orders to a range of online entities, the situation began to deteriorate. After the plaintiffs asked the court to hold Cloudflare in contempt for not following their instructions, Cloudflare fired back with amicus curiae support from Google, EFF and CCIA.

‘Power Grab’ Injunction is Invalid

The briefs submitted to the court are detailed but all agree that the injunction is impermissibly broad, lacking in detail, and contrary to Federal Rule of Civil Procedure 65 and the DMCA. Perhaps surprisingly, the plaintiffs continued to insist that they knew better.

Last week they submitted documents to further support their expedited motion for a contempt ruling against Cloudflare. The filing included exhibits claiming to show that Cloudflare’s DNS servers were servicing four new domains allegedly deployed by one of the pirate sites after its other domains were seized.

None of these domains were specifically listed in the injunction and as Cloudflare previously pointed out, any reading of the injunction that attempted to stretch it to cover new domains would violate fundamental limitations on the scope of available injunctive relief. Acting on the unsupported claims of the media companies with no judicial oversight is not an option, Cloudflare added.

Then this week, a sudden and unexpected light appeared on the horizon.

Broadest Piracy Injunction in the US Needs Adjustment

In a joint status letter filed Tuesday and addressed to Judge Katherine Polk Failla, whose signature authorized the original injunction, the media companies and Cloudflare say that progress is being made.

Following negotiations the parties say they have reached an agreement in principle to solve their differences. This will be achieved by addressing the core issues that led to the plaintiffs’ attempting to hold Cloudflare in contempt while addressing concerns raised by Cloudflare during a recent conference.

The specific details are not being made available at this stage but as soon as the agreement is formalized, the plaintiffs say they will file a motion to amend the default judgment and permanent injunction handed down by the court on April 26. An amended order will be presented for the court’s approval.

The plaintiffs say they will then withdraw with prejudice the pending motion for contempt against Cloudflare while reserving the right to file future motions to enforce the court’s original order or amended order, as appropriate. In turn, Cloudflare has agreed to withdraw its request for attorneys’ fees and costs incurred in responding to the plaintiffs’ motion for contempt.

It will be of great interest to see how the amended injunction balances the interests of the plaintiffs with those of Cloudflare and, by extension, every other service provider affected by the original injunction.

Update: The docket shows no indication that the agreement in principle is now a done deal but Judge Failla responded Wednesday as follows:

“In light of the above status update, the Court hereby deems both Plaintiffs’ contempt motion and Cloudflare’s request for attorneys’ fees and costs to be withdrawn.”

The plaintiffs’ declaration can be found here and the joint status report here (both pdf)